TSMC Encourages Employees to "Be Respected as a Global Company"...Government Provides Tax and Workforce Support [Taiwan Chip News]

Expressing Confidence While Fighting to 'Catch Talent'
Confident in Competition for AI Semiconductors Below 3nm

TSMC, the world's largest foundry (semiconductor contract manufacturing) company, has publicly declared its ambition to become a globally admired and respected enterprise, transcending its domestic roots. The CEO made this announcement to encourage employees, emphasizing that there are no longer any real competitors in the foundry industry.

TSMC Chairman Wei Zhaozhe is giving a speech at an investor conference held in Taipei on January 18.
[Photo by AFP Yonhap News]

According to the semiconductor industry, TSMC Chairman Wei Zhaozhe recently sent a letter to employees stating, "We are no longer just TSMC of Taiwan; we are now TSMC of the world." TSMC has been expanding its presence by establishing factories in Japan, the United States, Germany, and other countries.

The reason for Chairman Wei's confidence is that there are currently no clear competitors threatening TSMC in the foundry sector.

According to the Taiwanese market research firm TrendForce, TSMC held a 62.3% share of the global foundry market in the second quarter, ranking first. This was a 0.6 percentage point increase from 61.7% in the first quarter, and the gap with second-place Samsung Electronics widened from 50.7 percentage points in the first quarter to 50.8 percentage points in the second quarter. Intel did not make it into the top ten.

It is said that TSMC's only real rival is the antitrust regulations imposed by major governments. This reflects the company's overwhelming lead in technology and customer orders compared to its competitors.

In July 2022, Samsung Electronics succeeded in mass-producing 3nm chips about three months ahead of TSMC, but was unable to close the market share gap. TSMC's monthly production capacity for the 3nm (nanometer, one hundred-millionth of a meter) process is expected to reach up to 130,000 wafers by the end of the year. As pledged, TSMC plans to activate its 2nm process starting next year. As circuit widths become narrower, the quality of AI semiconductors improves. The more intense the competition in advanced processes becomes, the more advantageous TSMC's position is compared to its competitors, thanks to its superiority in technology, infrastructure, government policy, and supply chain (partners).

Chairman Wei expressed his gratitude to employees for overcoming inventory adjustments last year and delivering strong results in the first half of this year (January to June). In July, TSMC announced that its first-half sales reached 1,266,154,000,000 New Taiwan dollars (approximately 53.77 trillion Korean won), a 28% increase compared to the same period last year.

In his letter, Chairman Wei urged employees to "practice speaking honestly." He stated that TSMC will provide a work environment and employee experience characterized by diversity, fairness, and inclusion, so that all TSMC employees around the world can experience open and empathetic communication.

He noted that while TSMC has become an object of envy, there is still much room for growth before it can be a truly respected and beloved company. As TSMC grows into a multinational corporation, he emphasized the need to overcome language barriers among employees and to communicate based on empathy, respect, and inclusion.

Globally, the pool of semiconductor talent is limited, so semiconductor companies are just as focused on retaining outstanding internal talent as they are on recruiting from outside. Chairman Wei's message not only expressed confidence but also conveyed a strong commitment to securing internal talent.

The Taiwanese government has also responded to TSMC's vision. Taiwan's Minister of Economic Affairs, Kuo Tzu-hui, stated, "TSMC's foundation for growth remains in Taiwan," but added, "As TSMC expands internationally, it will become TSMC of the world, working with people from all over the globe." He made these remarks at a recent press conference for the "2024 Global Top 100 Technology R&D Awards" when asked about his views on "TSMC of the world."

Minister Kuo noted that as TSMC is exposed to diverse business cultures in countries such as Japan, the United States, and Germany, it is no longer a company solely for Taiwanese people. He also indicated that it is highly likely TSMC engineers will be dispatched overseas in the future.

The Taiwanese government is rolling out tax incentives and talent development support policies to ensure TSMC maintains its leadership in AI semiconductors.

Minister Kuo stated that the Ministry of Economic Affairs aims to elevate Taiwan's AI application industry to third place globally within four years. This goal overlaps with the South Korean government's ambition to join the "Big Three" in AI alongside the United States and China. Through an amendment to Article 10-1 of the "Industrial Innovation Ordinance," the Ministry has raised the investment tax credit cap to 18 billion New Taiwan dollars (about 750 billion Korean won) to support the construction of digital and low-carbon infrastructure for companies.

The government is also promoting the "2+4 Talent Development Plan" to support 25,000 overseas students annually. The Ministry of Economic Affairs expects to deploy 100,000 overseas students in the AI sector over four years. By adding 100,000 domestic talents, the goal is to secure a total of 200,000 AI professionals by 2028.

Taiwan Economic Daily News = Jing Huiling, Yin Huizhong / Translation by Asia Economy

*This article is reprinted based on a strategic partnership between our publication and Taiwan Economic Daily News.